Thread by @RiskRewardCap, Here it is - your $CMLF Sema4 DDGenomics playAI platformData like $PLTRDrug [...]

Here it is - your $CMLF Sema4 DD

Genomics play

AI platform

Data like $PLTR

Drug discovery

‍

‍Healthcare

World Class CEO

$190MM revenue in 2020

A high quality growth company with massive tailwinds, going the SPAC route to accelerate its vision. Lets go!

Low risk - long term reward

Attractive valuation: ~$3B (low compared to competition)

Low debt, high cash

P/S: ~15X fair for a high growth company

No near term catalysts, just pure execution on vision

Flywheel machine (more data = more

)

Business Model

Sema4 has a genomics testing solution for patients, which it leverages to build a repository of real world patient data

They then monetise this database to Pharma & healthcare systems

Would Pharma & healthcare pay for this service

Absolutely

A brief history lesson

In 2016, the Congress passed the Cures Act to accelerate medical product development

The Act included a provision for the FDA to create a Real World Evidence (RWE) framework to guide developers in using Real World Data (RWD) for regulatory approval

RWD

RWE

Real World Data (RWD) are the data relating to patient health status or the delivery of health care routinely collected from a variety of sources

Real World Evidence (RWE) is clinical evidence regarding the usage of medical product derived from analysis of RWD

How does this relate to Sema4? Hang in there, it will make sense

Pharma companies see massive value in RWE/RWD

Study by Deloitte surveying pharma reveals:

94% believe RWE will be very important by 2022

Almost all companies expect to increase external partnerships for RWD

How does this relate to Sema4? Hang in there, it will make sensePharma companies see massive value in RWE/RWDStudy by Deloitte surveying pharma reveals: 94% believe RWE will be very important by 2022Almost all companies expect to increase external partnerships for RWD

Unprecedented tailwinds

All Pharma companies now believe RWD is important

The FDA is now pushing for the use of RWD

RWE is derived from analysing RWD

Pharmas are constantly searching for high quality data sources

Who has the best clinical data?

Enter Sema4

Unprecedented tailwindsAll Pharma companies now believe RWD is important The FDA is now pushing for the use of RWDRWE is derived from analysing RWDPharmas are constantly searching for high quality data sourcesWho has the best clinical data? Enter Sema4

How much Real World Data does Sema4 have?

10+ million patient records

5 million records w/ longitudinal clinical data

300K patient genomic data
.. and growing

Information stored & processed inside its Centrellis engine which uses machine learning to derive insights

How much Real World Data does Sema4 have?10+ million patient records5 million records w/ longitudinal clinical data 300K patient genomic data.. and growingInformation stored & processed inside its Centrellis engine which uses machine learning to derive insights

Flywheel alert

Sema4 collects clinical data from patients & other sources

..the data is fed into the Centrellis engine which generates insights for client use in trials, models

..which then creates enhanced data that is fed back into Centrellis

we like a good flywheel

Flywheel alertSema4 collects clinical data from patients & other sources..the data is fed into the Centrellis engine which generates insights for client use in trials, models..which then creates enhanced data that is fed back into Centrelliswe like a good flywheel

This is where it gets fun..

Combine the demand for Real World Data with Centrellis and you get a business that compounds data like Buffet compounds his investments

The more customers use Sema4, the better the data will be for future customers and the wheel keeps spinning

I see two main customers: health systems & Pharma companies

For health systems, the value proposition is simple: offer actionable insights at every stage of the patient journey

The value Sema4 provides is the ability to personalise insights which could help identify risks

For Pharma companies, Sema4 has a smorgasbord of solutions.

In general, Sema4 adds value to Pharma's who need to use its intelligence to:

De-risk drug development

Reduce developmental costs

Improve patient selectivity

Increase speed to market

and so on..

For Pharma companies, Sema4 has a smorgasbord of solutions. In general, Sema4 adds value to Pharma's who need to use its intelligence to:De-risk drug developmentReduce developmental costsImprove patient selectivityIncrease speed to marketand so on..

Sema4's growth strategy

The base: revenue from genomics testing

The core: providing data-driven insights to improve the outcomes for Pharma & health systems

The aspiration: potentially a consumer play that matches patients to healthcare solutions and services (fascinating)

Sema4's growth strategyThe base: revenue from genomics testingThe core: providing data-driven insights to improve the outcomes for Pharma & health systemsThe aspiration: potentially a consumer play that matches patients to healthcare solutions and services (fascinating)

The numbers

2020 rev: 190M

2021 exp rev: 265M (38% increase)

2020 gross margin: 22% (healthy)

2021 exp grosss margin: 32%

To achieve this, $CMLF needs to expand into other markets outside of women's health and increase the number/size of partnerships. Watch closely

What is Sema4's TAM

This is a tricky one to size (in a good way), Sema4 is pulling so many things together in an unprecedented way that it is difficult to see their ceiling

To use their own sizing: they estimate a $643B total addressable market

Their valuation is ~$3B

What is Sema4's TAMThis is a tricky one to size (in a good way), Sema4 is pulling so many things together in an unprecedented way that it is difficult to see their ceilingTo use their own sizing: they estimate a $643B total addressable marketTheir valuation is ~$3B

Where does their valuation stand amongst competitors?

$NVTA:$7.3B
$NTRA: $8.9B
$GH: $15.5B
$EXAS: $21B
$ADPT: $5.5B

$CMLF: $3B

I think its only crime is that it is underreported and it just missed the post Covid-19 Genomics mini bull run. There is a fair deal to be had here

Leadership

It would be remiss of me not to mention the world class CEO: Eric Schadt Ph.D.

Dean for Precision Medicine at Mount Sinai
Fr Head of Genomics, Merck
Fr CSO $PACB
Founder at Sage Bionetworks
Chief Scientist at Rosetta Inpharmatics

You want him on your team